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Insights   >   How KSA’s Saudization & Vision 2030 Empowers Foreign Businesses Through Localization

How KSA’s Saudization & Vision 2030 Empowers Foreign Businesses Through Localization

Author: TASC Staff Writer
Nov 29, 2021
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Candidates • Employee retention • Employers • Jobs • Retail • Remote workers • IT • Culture • Employer Guide • Workplace • O&G • KSA

A vibrant society, a thriving economy, and an ambitious nation -these are the three primary themes of KSA’s Vision 2030. While it may sound like the idea is focused more on the internal matters of the Kingdom, the fact is that it is built to establish a productive connection with the world. With Saudization and Vision 2030, KSA is creating a balance between the national and foreign units in its corporate structure. 

Here are some of the objectives of Saudization and Vision 2030 that will shape the corporate structure in the future. 

Objectives Of Saudization and Vision 2030

Saudization, officially known as the Saudi Nationalization Scheme, or Nitaqat, is one of the main factors driving KSA's Vision 2030. The idea is to empower Saudi nationals by providing them with better education and employment opportunities in the coming years. 

For this, the government has implemented regulations on hiring in the private sector. The private firms are classified into six groups, Platinum, High Green, Mid Green, Low Green, Yellow, and Red. Based on their group, a company will face regulations on various privileges such as Block Visas, Expedited Processing, Renewal of Work Permits, Transfer of Sponsorship, etc. 

According to the Nitaqat framework, any company with more than 9 employees must hire a certain percentage of Saudi nationals, depending on their category. Platinum category firms need to hire a higher number of Saudi Nationals compared to the other groups. 

Companies with less than 10 employees are exempt from the Saudization regulations. However, they must still hire at least 1 Saudi employee in the company to meet the compliance regulations. Other rules of Saudization include directions for minimum salaries and labour rights for Saudi Nationals. Along with local employment, KSA’s Vision 2030 also focuses on increasing investments in future plans to improve the growth potential for foreign businesses. 

How Local Talent Benefits Companies?

At a glance, companies may feel employing local employees will affect their performance. However, employing local talents is actually a lot more beneficial for the companies than hiring foreigners in KSA. Here are some of the advantages companies can expect when they have a reliable and talented local workforce.

  • Better Management: Hiring local talents in managing positions can improve a company's efficiency overall. Local employees are fluent in the local language, which allows them to connect well with the labour and other employees. They can understand employee needs better than a foreign national, and therefore, manage the workforce better. 
  • Local Understanding: People of KSA are rooted in their culture. They have a better understanding of local trends and preferences. So, when businesses have a talented local workforce, they can make better decisions in the local arena. 
  • Convenience: Hiring locals is a lot more convenient for employers. A company can just outsource the hiring process, and the experts can help you find the right talent within the required timeframe. The hiring service providers act as an in-house hiring team, so the company controls the hiring process without having to create a separate infrastructure. 
  • Training and Onboarding: Due to their understanding of the local culture, local employees do not require extensive language and cultural training. Therefore, companies can focus more on the core operations and create a faster, more productive training and onboarding set-up. 

Localization has plenty of benefits for a company. But due to a lack of understanding of the local arena, companies often struggle to extract the full potential of localization.

So, how can a company make the most out of Saudization and Vision 2030? Read on. 

How To Find Local Talent And Meet Saudization Needs?

Saudization and KSA's Vision 2030 can enhance business performance if companies invest wisely. Connecting with local agencies is the key. Local KSA and Saudization service providers have years of experience in the local domain, and therefore, they can reduce hiring hassles remarkably.  

The service providers can take care of Saudization compliance and help find the right talent locally. For instance, recruitment and outsourcing agency TASC Outsourcing offers dedicated KSA and Saudization services for large and small companies in KSA. This enables companies to improve the quality of hiring and ultimately benefit from Saudization.

Conclusion

Saudization and Vision 2030 has remarkable potential for growth for foreign businesses in KSA. As companies gradually replace their expensive foreign workforce with talented locals, they can expect to have higher efficiency and better overall performance in the local domain. 

So, companies now only have to worry about pitching the right partnerships with experienced KSA service providers. Once that's achieved, the rest of the hiring and Saudization needs will be met automatically. 

 

References

https://www.arabnews.com/node/1890971/saudi-arabia

https://www.vision2030.gov.sa/

https://www.fragomen.com/insights/saudi-arabia-new-saudization-requirements-forthcoming-in-certain-sectors.html#:~:text=The%20new%20Saudization%20requirements%20aim,conditions%20in%20the%20affected%20sectors.

https://www.arabnews.com/node/234230